MENA airlines face a possible USD 4.3 bn in losses

MENA airlines will be the world’s only major market in the red this year. The International Air Transport Association (IATA) projects the region’s carriers will swing to a collective USD 4.3 bn loss in 2026 — the worst-hit globally — on airspace closures and lost passenger volumes through March and April. Passenger demand is set to fall 11.4%, while capacity is expected to contract 4.4%.

Jet fuel adds to the pain: IATA assumes Brent crude rates will average USD 95 per barrel, whereas jet fuel is expected to be at USD 152 per barrel in 2026 — about 70% higher than 2025. Jet fuel prices are a source of pressure for the entire global industry, but GCC airspace closures are what set the region apart.

The dependency that hurts: Gulf carriers depend heavily on east-west transfer flows through Dubai, Doha, and Abu Dhabi, which makes lost connectivity have an outsized impact on earnings. The disruptions opened a near-term opening for rivals like Turkish Airlines and Singapore Airlines on long-haul routes linking Asia and Europe, we previously reported.

Recovery talks look too early to call: Etihad CEO Antonoaldo Neves recently said the Abu Dhabi-based carrier is aiming to restore pre-war flying levels plus adding an 8% y-o-y of extra capacity by 15 June. His comments came against the backdrop of a fragile ceasefire that has since seen active US-Iran combat return.

In other aviation news

Riyadh Air’s maiden flight landed in London on Wednesday evening, launching the country’s second national airline after Saudia after months of delays primarily due to aircraft delivery setbacks from Boeing. The PIF-backed airline is expected to have a total of eight aircraft in its fleet by the end of next month, CEO Tony Douglas said. Riyadh Air is currently operating flights to six cities, with plans to reach 22 cities by next March.